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i v e d I n f o r m a t i o n

``SEC. 14204. ADMINISTRATIVE FUNDS STUDIES.

``(a) Federal Funds Study.--

``(1) In general.--The Secretary shall conduct a study of the use of funds under this Act for the administration, by State and local educational agencies, of all covered programs, including the percentage of grant funds used for such purpose in all covered programs.

``(2) State data.--Beginning in fiscal year 1995 and each succeeding fiscal year thereafter, each State educational agency which receives funds under title I shall submit to the Secretary a report on the use of title I funds for the State administration of activities assisted under title I. Such report shall include the proportion of State administrative funds provided under section 1603 that are expended for--

``(A) basic program operation and compliance monitoring;

``(B) statewide program services such as development of standards and assessments, curriculum development, and program evaluation; and

``(C) technical assistance and other direct support to local educational agencies and schools.

``(3) Federal funds report.--The Secretary shall complete the study conducted under this section not later than July 1, 1997, and shall submit to the President and the appropriate committees of the Congress a report regarding such study within 30 days of the completion of such study.

``(4) Results.--Based on the results of the study described in subsection (a)(1), which may include collection and analysis of the data under paragraph (2) and section 410(b) of the Improving America's Schools Act of 1994, the Secretary shall--

``(A) develop a definition of what types of activities constitute the administration of programs under this Act by State and local educational agencies; and

``(B) within one year of the completion of such study, promulgate final regulations or guidelines regarding the use of funds for administration under all programs, including the use of such funds on a consolidated basis and limitations on the amount of such funds that may be used for administration where such limitation is not otherwise specified in law.

``(b) General Administrative Funds Study and Report.--Upon the date of completion of the pilot model data system described in section 410(b) of the Improving America's Schools Act of 1994, the Secretary shall study the information obtained through the use of such data system and other relevant information, as well as any other data systems which are in use on such date that account for administrative expenses at the school, local educational agency, and State educational agency level, and shall report to the Congress not later than July 1, 1997, regarding--

``(1) the potential for the reduction of administrative expenses at the school, local educational agency, and State educational agency levels;

``(2) the potential usefulness of such data system to reduce such administrative expenses;

``(3) any other methods which may be employed by schools, local educational agencies or State educational agencies to reduce administrative expenses and maximize the use of funds for functions directly affecting student learning; and

``(4) if appropriate, steps which may be taken to assist schools, local educational agencies and State educational agencies to account for and reduce administrative expenses.